FCC: Forbearance Or for Worse

6/21/2010 2:37 PM Eastern

By: John Eggerton

Washington — The Federal
Communications Commission’s
vote to start the commentgathering
process on classifying
broadband Internet access as a
Title II telecommunications service
drew strong reaction from
both sides of the debate last
week, with those in each camp
girding for a bigger battle.

The FCC’s Democratic majority
voted 3 to 2 to launch an effort
to clarify its authority to regulate
broadband, while the two Republican
commissioners respectfully,
but strongly, dissented.

Chairman Julius Genachowski
again called his so-called thirdway
approach a compromise
between doing nothing and overregulation.
“My focus is not an
any particular legal mechanism,”
he said, but for the FCC to “simply
restore the status quo and have a
workable, light-touch framework
for broadband access.”

In fact, the inquiry also solicits
comment on options other than
the three ways offered up.

Rep. Ed Markey (D-Mass.), a
fan of network-neutrality regulations
and Genachowski’s “third
way,” called the approach a sensible
and measured way of “carefully
cutting the Gordian knot
that has tied up our nation’s
broadband networks in regulatory
uncertainty since the Comcast
decision.”

Gigi Sohn, president of advocacy
group Public Knowledge,
which backs network neutrality,
said the commission majority
had acted with “uncommon
courage,” calling it a “simple, uncomplicated”
move.

During the meeting, Republican
FCC commissioner
Robert McDowell
pointed out that a majority of the
members of the House, including
74 Democrats, had cautioned the
chairman not to proceed with his
third-way proposal.

Sohn chalked that up to the industry’s
lobbying muscle, suggesting
that those legislators were
either their dupes or prisoners of
their pocketbooks.

“The commission has been attacked
unmercifully by multibillion-
dollar companies using
threats, intimidation and fabrications,
among other distasteful
tactics,” she said. “They have
used captive or unwitting legislators,
in the face if common sense,
to further their corporate goals at
the expense of millions of Americans.”

Satellite-TV firm Dish Network
was all backslaps and hoorays.
“We strongly support chairman
Genachowski’s leadership in
moving this critical process forward,”
said Dish chairman Charlie
Ergen in a statement. “A sound
legal framework is absolutely necessary
to preserve a free and open
Internet and encourage innovation
and investment.”

But there were plenty of
discouraging words and
predictions of cloudy forecasts
in the wake of the 3-2 partyline
vote. Republican Reps. Joe
Barton (R-Tex.) and Cliff Stearns
(R-Fla.) were ready with a letter
to give to the chairman of
the House Energy & Commerce
Committee, Rep. Henry Waxman
(D-Calif.), and the Communications
Subcommittee chairman,
Rick Boucher (D-Va.), asking the
congressmen to join them in trying
to block the FCC. Barton is
the ranking member of the full
committee; Stearns holds the
same position in Boucher’s subcommittee.

Barton and Stearns called
for a hearing before the August
break, saying the third way
would “only cast prolonged legal
and policy uncertainty over
the future of broadband.”

In expressing his support for Title
II, FCC commissioner Michael
Copps argued during the meeting
Thursday that to leave broadband
service under the Title I regime —
a regime undercut last year, when
U.S. Court of Appeals for the D.C.
Circuit ruled that Comcast’s attempts
to regulate the Internet
file-sharing service BitTorrent
violated FCC network-openness
principles — would itself create
legal uncertainty, as broadband
oversight would become a “court
case-by-court case” process.

FCC general counsel Austin
Schlick echoed that view, saying
there could be years of individual
court challenges, or a single challenge
to a Title II reclassification.

Another pair of House Republicans,
Reps. John Shimkus of Illinois
and Marsha Blackburn of
Tennessee, have also expressed
their opposition to the chairman’s
third way proposal.

Netcompetition.org, whose
members include the National
Cable & Telecommunications Association
(as well as Comcast and
Time Warner Cable), the American
Cable Association, Verizon
Communications and Sprint Nextel,
minced no words. The coalition
suggested the FCC was in the
thrall of a certain search giant.
(The commission is not flexing
its broadband regulatory muscle
over content or applications.)

“Make no mistake,” said Netcompetition.
org chairman Scott
Cleland, “Google is the specialinterest
power behind the curtain
pulling the strings here. This
veiled FCC proposal is conveniently
on path to deliver all the special
regulatory favors Google has been
seeking from the FCC in one rushorder,
gift-wrapped package.”

Countered Mistique Cano,
Google’s manager of global communications
and public affairs:
“Everyone knows that Mr. Cleland
stopped being a neutral analyst
years ago and is now paid by
Microsoft and AT&T to be a fulltime
Google critic.”

In its own statement, Verizon
said the reclassification was
a “terrible” idea. “The negative
consequences for online users
and the Internet ecosystem would
be severe and have ramifications
for decades,” said former Rep. Tom
Tauke, now Verizon’s executive vice
president for public affairs, policy
and communications. “It is difficult
to understand why the FCC continues
to consider this option.”

National Cable & Telecommunications
Association president
Kyle McSlarrow suggested
the FCC should defer to Congress
on the broadband-authority call .
“[W]e see little benefit to changing
course and great danger in
attempting to shoehorn modern
broadband services into a Depression-
era regulatory regime
without serious collateral effects
to investment, employment, and
innovation,” he said.

Said AT&T senior executive
vice president Jim Cicconi: “Today’s
decision by the FCC is troubling
and, in many respects,
unsettling. It will create investment
uncertainty at a time when
certainty is most needed. It will
no doubt damage jobs in a period
of far-too-high unemployment.

“It will also undermine the FCC’s
own goals for the National Broadband
Plan,” he added. “A better
and more proper approach
is for the FCC to defer the question
of its legal authority to the
U.S. Congress.”

In a blog posting on the eve of the
vote, AT&T argued that the FCC’s
third way is actually an attempt to
go in two directions at once.

To argue for why it can
change broadband classification without citing any
major market shift or altered circumstances,
the FCC has cited
the Supreme Court’s decision in
the Fox vs. FCC profanity case,
upholding its shift in enforcing
indecency rules.

But AT&T pointed out that the
FCC has argued that the reasons
its plan to not apply (or forbear)
most of the Title II regulations
could not easily be reversed —
and that more of those rules applied
to broadband — is because
the FCC has said it would take a
“painstaking process” in which
it would have “to compile substantial
record evidence that the
circumstances it previously identified as supporting forbearance
had changed.”

Said Steve Largent, president of
CTIA, The Wireless Association:
“We are disappointed that the
Commission continues to consider
the application of monopoly-era rules for the U.S. mobile
broadband ecosystem.”

CHEERS AND JEERS FOR TITLE IIWASHINGTON — The Title II fight became a battle of words last
week, as both sides took off the rhetorical gloves:

FCC commissioner Michael Copps: I, for one, am worried
about relying only on the goodwill of a few powerful companies
to achieve this country’s broadband hopes and dreams. … Turn
on your TV and watch what is taking place right now in the Gulf of
Mexico.

Gigi Sohn, Public Knowledge: “The Commission has been
attacked unmercifully by multi-billion dollar companies using
threats, intimidation and fabrications, among other distasteful
tactics.”

Tom Tauke, executive VP, Verizon Communications:
“Reclassifying high-speed broadband Internet service as a
telecom service is a terrible idea.”

Randolph May, president, Free State Foundation: “It is
sad but true that Don Quixote-like, Chairman Genachowski is
leading the Commission on an ill-fated journey, all in the name of
searching for solutions to nonexistent problems.

Rep. John Shimkus (R-Ill.): “To bring the national government
in control of the (broadband) system, which is in essence
uncontrollable, will destroy incentive to all this new high-tech
growth and development.”